G20 want to get global economy back on track

In the final declaration of the G20 summit in the Chinese city of Hangzhou the heads of the world's leading industrial nations promise an action plan for boosting the global economy. Some commentators are disappointed with the results of the summit. For others it marks the beginning of the end for the austerity policy mainly applied in the EU.

Importance of G20 talks

Jyllands-Posten explains why the world should rejoice over every G20 summit:

“Because they are the only global forum where the world's most important leaders can meet in an informal setting. … However, we live in a time when the will to invest political capital to jointly overcome global challenges is worryingly modest; above all when we look at the growing populism that avoids all responsibility in Europe, the US and other parts of the world. Yet now is the time for economic result-oriented dialogue that shows the world that cooperation creates jobs and prosperity and reduces inequality. In this respect the G20 has delivered little so far.”

Signs of an end to forced austerity

After the participants at the G20 summit called for public spending to increase to stimulate the global economy Le Soir hopes for a paradigm change within the EU:

“Not every problem can be solved with monetary policy and by lowering the interest rates, that much is clear now. What is missing are those few minutes of political courage that would finally allow the heads of government to shoulder the responsibilities borne up to now by the European Central Bank and to allow certain public expenditures to benefit from a more flexible fiscal treatment. The Commission seems ready for a change of course. However it is lacking that last big political push on the European level to get a 'yes' from Germany that could definitively tilt the balance in favour of an end to austerity.”

Those who want more growth must do more

The final declaration is not very convincing, the Frankfurter Allgemeine Zeitung complains:

“The problem of how to stimulate growth in industrial and emerging countries was addressed once again in Hangzhou. Monetary policy is increasingly proving to be inadequate. And financial policy has also reached its limits, as the public debts of many countries have reached levels that could become unmanageable if interest rates go up again. So the only growth incentives at our disposal are pro-competitive reforms and new trade agreements. In such a context it's easier to lay out your goals than it is to achieve them. China, for example, hasn't reduced its overcapacity in the steel industry, as it said it would. New free trade deals are taking their time to materialise. Those who want more growth must do more to achieve it.”

The fight against inequality can begin

The summit's final declaration holds out hope for the future, the Catholic daily Avvenire believes:

“The call for inclusive growth and the drawing up of a blacklist of tax havens (with sanctions foreseen) are two signs in the G20 final document that give us hope that 'phase 2' of globalisation is beginning. In the first phase the integration of production and labour markets allowed companies and big capital to promote a shameful dumping competition between nation states. It was and is a competition to see who can offer 'the best' in terms of taxes, labour costs and working conditions and convince the big transnational companies to set up shop on their territory. … It is time to end this first phase globally, and we should begin here in the EU, where the time has come for a cooperative strategy on company taxes.”

Major powers as uncooperative as at Vienna Congress

The G20 summit in Hangzhou is reminiscent of the Congress of Vienna of 1814/1815 during which Europe was restructured after the Napoleonic Wars, Le Figaro comments:

“How wonderful it would be to live in a world ruled by law and fair play, where Beijing accepted an equitable division of the South China Sea, where Moscow accepted that Nato advance up to the Don, where the burden of refugees was shared by all the countries in the world, where Washington renounced the exorbitant privileges of the dollar, where London abandoned fiscal dumping, and where Riyadh stopped financing the spread of Wahhabism. Unfortunately this ideal world is not the one we saw at the G20 meeting in Hangzhou. We have returned to the concert of nations of the Congress of Vienna, to which some 200 European mini-states were invited but where everything was decided by the big powers. We're no longer seeking legality, just a balance of power.”